Transportation management systems (TMS) have been around for a long time, but TMS has, historically, been down the priority list for many companies compared to other enterprise applications, such as Enterprise Resource Planning (ERP) and Customer Relationship Management (CRM). Today, however, companies are making TMS a priority. What factors are driving this trend?
For starters, some companies are making TMS a priority after learning a painful lesson — that is, after experiencing escalating transportation costs, declining services levels, market share loss, and/or a drop in customer satisfaction. But as Gregg Lanyard, Director of Product Management at Manhattan Associates, discussed in a recent episode of Talking Logistics, there are several other factors at play too:
Supply chains are more dynamic and complex than ever before, and that equals more risk. So companies need to be more nimble and prepared to respond to change. You hear more about supply chain failures in the media today than ever before — whether it’s port closures, natural disasters, mergers and acquisitions, new regulations. TMS allows companies to adapt, prepare, and facilitate these changes.
Another factor is that customer expectations are higher than ever, with shorter lead times and next-day/same-day delivery becoming more common. We’re truly, not only in our personal lives but in the business world too, in this “instant gratification” mode, which is really the new norm, and TMS provides the optimization and visibility to orders and shipments to succeed in this new environment.
Of course, e-commerce is truly changing the game from a transportation and logistics perspective. There’s a need for companies to reassess their supply chains like never before. They’re asking: How do I optimize transportation? How do I optimize the solutions that are interacting with the warehouse and transportation?
In addition to transportation and logistics executives, there are a lot of other stakeholders involved in building the business case for a TMS and getting the most value from it. Let’s start with the CIO, for example. How does a TMS align with the challenges and objectives CIOs face? Watch the short clip below for Lanyard’s response:
“In the end, it’s really about long-term project viability,” said Lanyard. “With a TMS, you’re talking about a very intertwined system, it’s not a black box; it touches upstream and downstream systems and it’s really critical to daily operations. So all of these things have to be considered and they’re on the CIO’s mind to make sure the right solution is implemented.”
I encourage you to watch the rest of my conversation with Gregg for additional insights and advice on this topic, including why CFOs should make TMS an enterprise priority too and what’s new and exciting with TMS from a technology and capabilities perspective.
Is your company making TMS an enterprise priority? If not, what are the hurdles or roadblocks in the way? Post a comment and share your perspective!